BIR Ruling

March 1, 1968 Miller, Cruz & Co. Certified Public Accountants BPI Building Bacolod City Attention: Mr . Rodolfo M . Litonjua Gentlemen : This refers to your letter dated January 18, 1968 seeking an opinion as to whether or not a church organization known as "Rainbow Foundation" which undertakes a business project, is subject to any revenue tax. It is represented that the primary objective of the organization is community development or the upliftment of rural areas, utilizing the services of parish priests with the help of laymen; that its business operations or process is cutting textiles to be distributed to farm laborers through their respective parish priest for sewing and the laborers receives P1.00 to P2.00 a suit on a piece-work basis and once finished, the suits or maong slacks will be brought back to its main office for marketing In reply thereto, I have the honor to inform you that under the foregoing facts, this entity is considered a manufacturer, hence, subject to the annual fixed tax of P20.00 as prescribed in Section 182(A)(1) of the Tax Code and to the 7% sales tax imposed in Section 186 of the same Code. It is also subject to the income tax. Inasmuch as this organization is subject to tax, its business name and style must be registered with this Bureau pursuant to Section 203 of the Tax Code. It must also comply with all requirements of the law and regulations as regards the keeping of books of accounts and the issuance of invoices and receipts. atdc Very truly yours, (SGD.) MISAEL P. VERA Commissioner of Internal Revenue